In these current times we turn to government for help despite years of criticizing it, under funding it and complaining about it.
Government, as Americans we love to hate it. The usuals suspects are it costs too much and doesn’t deliver the proper services, it’s too big and intrudes into our lives, over regulates us and the list can continue. President Reagan gained a huge applause saying, “Government is not the solution to our problems, government is the problem.”. He followed this with his “Starving the beast” a political strategy employed by American conservatives to limit government spending by cutting taxes, in order to deprive the federal government of revenue in a deliberate effort to force it to reduce spending. This has been a common mantra for many politicians, particularly Republicans, for years. It assumes that the more minimal the size of government service, the better our lives will be. Cut taxes, there is always room to cut more, the beast is starving.
The economic role of government is to focus on stability according to a recent Forbes article. Heritage analyst Karen Campbell says—“but the government must focus on maintaining economic stability. Fiscal responsibility is an important part of that stability.” If government is the problem and we need to minimize tax receipts, then how is that fiscal responsibility or insuring stability. If I have a wife and two children I can determine the maximum amount of money I may spend each month. My paycheck like many of us is a standard amount each week, or month or year. That is the money I have to cover my expenses food, shelter, clothing, fuel, a little extra for the unexpected, etc. If something happens to knock that out of whack such as a job loss, needing a major car repair, an unexpected hospitalization, the budget is squeezed. This is my beast and it is hungry but I may have no way to feed it or to provide for my family. I simply don’t make enough money.
A budget is an information document that provides a listing of how money can be spent based upon expected and prior costs. The same issues can occur in my home and in government. Unanticipated public expenses such as unusual flooding in spring, an intense fire season, a security problem requiring added police, bridge repairs, etc., how do we pay for these? A government can’t raise the price of goods and services. The most viable method for the public sector, federal, state or local to raise that extra cash for needed services is to raise taxes. That can be a high hurdle to overcome. Raising tax money by increasing the millage rate is never popular. We know how well levies and bonds are received by many of us.
The role government assumes in hard times as during the Great Recession or the current Pandemic is to focus on fiscal policy. Fiscal policy includes both government spending and tax cuts. “People need to dispense with the proven lunacy that insists fattening corporations and “the market” delivers “healthier, wealthier, more motivated and productive workers.” In prior recessions the economic downturn had helped highlight the problems of job loss and job insecurity, presenting a unique opportunity to work for change. As our current Pandemic has clearly shown us “starving the beast” is a problem.
Insufficiently financed rainy-day funds also called budget stabilization funds have left the majority of states unprepared. These dedicated pools of money are set aside by states during good times to help them weather economic downturns with enough money. Rainy-day funds help them to balance their budgets when tax revenues fall, without resorting to devastating spending cuts or tax increases at exactly the wrong moment.
The current time and its impact on us and policy makers highlights the lack of sick leave, which makes it impossible for many workers to follow the public health recommendation of staying home when they have the flu or other contagious illnesses. In the past at the time when the nation was trying to limit the spread of the H1N1 flu, Ellen Bravo of the consortium, Family Values @ Work said, “The recession is making it more likely that people will go to work sick…. It isn’t just about losing your job. It’s about losing a day’s pay.” Now the HiNi flu has arrived on steroids.
The role of government in hard times becomes clear again. The current economic devastation highlights the problems of job loss and job insecurity, presenting a unique opportunity to work for change. The party of F.D.R. and L.B.J.embraced direct state action as a powerful tool for preserving and promoting prosperity. The seventies and eighties heard the cries that the Great Society government programs went too far in helping people and cost too much. Perhaps in some instances that was true. Unfortunately when it comes to government we can never seem to find the middle ground. The pendulum swings in extremes. Now we know, we as a people through our government have gone too far in the opposite direction. The current two trillion dollar stimulus package shows that clearly. In his 1996 State of the Union address President Clinton stated, “the era of big government is over.” We now know he was right but that it was wrong.
If the era of small government is over, and it is, then it’s well past time for forward looking people to seize a moment that belongs to them. As we struggle now and for a while to recognize that individualism may be important but being together is where we need to be now. Helping each other and leaving no one behind is who we are. Government needs to refocus on helping people not insuring the welfare of corporations. Stabilizing the economy must focus first on those of us who keep the engine running. Government is not the problem, it is a great part of the solution. It must be seen as a valuable link between us and our daily lives. As the coronavirus outbreak illustrates we should be over investing in public health, over preparing and not under-preparing. “Hope in the time of corona lies in rebuilding the role of government.” (The Guardian 3/23/20). We may not need to return to the Great Society Days but hopefully days of a Better Society. If we acknowledge anything from this Pandemic, it’s government can make a difference. Government matters.